Thursday, June 16, 2011

Love's Labors Lost

Eve online has come up with a new scheme for monetizing third party applications and websites.

Up to now, Eve hasn't allowed third party applications to charge for the use of web applications or websites that leverage CCP APIs or other intellectual property - like those slick Eve-fonts and graphics CCP hands out. That restriction on monetizing has been the downfall of a number of apps and websites, including the much-loved but underfunded Capsuleer phone app.

The world is about to change. In exchange for $99 and signing a commercial licensing agreement with CCP, you may now can charge subscription fees, receive donations, sell your app in an app-stores. This should go a long way toward making some of the more sophisticated third parts tools more financially viable.

"But Mord," you might say, "Aren't there successful apps and websites like Dotlan and Eve Tribune that already solicit donations in order to keep the doors of their websites open? "

Why yes. You're absolutely right. That loophole will close. Sites like Dotlan that leverage Eve API and solicit donations to pay operational costs are regarded by CCP as commercial sites and will be required to sign up for the program and fork over the licensing fee. Eve Tribune seems a dicier case. They do solicit donations, but how much they use CCP intellectual property is open to interpretation. If they've signed an agreement to allow use of Eve graphics and fonts, chances are they'll be required dig into their wallet in exchange for the privilege of continuing to do what they've been doing for years.

Oh, and sites that take payment or donations in ISK are commercial as well. This would likely include special activity sites like Hulkageddon. Blogs like Rixx Javix's Evoganda, which hosts event's like Death Race that include an ISK based sign up fee (which is used for prizes) may have to sign up as a commercial app, or cease such operation. Even owners of non commercial apps and sites will be required to join up, albeit without charge (for now).

Now, given the number of third party apps out there, $99 is not a great deal of money for a corporation like CCP. So why do this? I suspect the goal of the program is two-fold.

First of all, CCP would like to make third party apps more viable. The ability to monetize a site or app should mean that the better, more innovative of them will become more viable and hang around longer - thereby improving the Eve and Dust514 experience at no cost to CCP. Further, if the third-party developer community thrives and starts making big bucks, this program will leave CCP well positioned to demand its cut of the income.

Meanwhile, the registration process for commercial apps establishes a precedence of CCP maintaining a degree of control over these third party apps and allows CCP to define its intellectual property boundaries. All very important for future lawsuits. It also allows CCP some leverage with regard to content control. If a licensed web site is doing or saying things that CCP doesn't approve of, CCP can simply threaten loss of that license to pull said web site back into line. So, to a large extent, this initiative appears to be as much about control of the Eve and Dust brands and non CCP content about those brands as it is about money.

It will be interesting to see how aggressively and how far CCP pushes the new regime. For many third party purveyors of Eve and Dust514 content, particularly the donation sites, this will be a forced change to their business model. Some of them will prosper under the new regime. Others will fold up tents rather than pay for what has been, to date, a labor of love.

6 comments:

Thank you thank you Mord! Finally, a rational THOUGHT OUT reaction to this! Thank you for being a voice of reason amidst all the histrionics. I'm glad I'm not the only one who actually read CCP's entire statements.

^ What Lex said. It's ridiculous to charge for some things that they want to charge for though. "So you receive ISK donations? Fork over the cash." I understand that they have the right and reason to charge for some things, but, as cliche as it sounds, they really did go a step too far.

And they certainly ARE benefiting financially by these labors of love, even if it is not a direct cash flow. I'm sure they want to keep those open, while allowing the bigger paid ones to flourish as well. They tried a "low" fee to try and keep them, the community didn't bite. I think it's reasonable to see some reductions in scope of this new motion soon.

Basic rule of economics: make something cost more, you get less of it.

So we may very well get less apps not more. After all, sites like Dotlan solicit donations, but my understanding is much of that is just to cover hardware costs alone and even then its touch and go.

Of course, some apps like Dotlan might do very well given how useful it is. A small monthly fee might see a sudden windfall for Wollari....or not. Right now Dotlan, as an example, is insanely popular...it also has an unbeatable price: $0. How popular it will be once people have to pay? I don't know. Depends I guess on how much one has to pay. If it is a $1/month sure many people will probably pay for it. $20 flat fee? Again, maybe.

And part of this depends on the interpretation of "in game service". Is dotlan an in game service? I use it when planning routes for my jump frieghter...you can access it from in game. If so, then whoops, no cash for Wollari, he'll have to take isk donations which might make things even more annoying in terms of trying to recoup that $99.

The overall reaction has been pretty negative. Either these people don't see the "golden opportunity" due to stupidity, or they don't think that "golden opportunity" is all that golden. I'm thinking on the latter.

If it is considered an "in game service" then it would probably cease to exist.

In game services cannot charge RL money. Only isk donations. But last go round, Wollari solicited RL donations to upgrade his hardware, IIRC.

If it isn't considered "in game" then my guess is we'll see just a few apps like Evemon, Dotlan, and some others. This isn't like the iPhone where you have 10s or millions of potential customers. At best you have maybe 50,000 to 100,000.

Could very well stifle creativity since you'll have to fork over the $99 before you find out how in demand your new idea is. Many might decide that $99 has better uses in RL.

On the other hand, Wollari could move to a subscription funded rather than donation funded service. He'd only need 50 people to sign up for a $2/yr subscription to make up the licence fee. Then some more folks to cover what he's currently getting in donations.

What if players could pay the subscription through the Noble Store using Aurum? http://www.eveonline.com/ingameboard.asp?a=topic&threadID=1528607&page=20#579

Once the ISK-funded/ingame services are sorted out, the third party environment should look much nicer. Even better if the third parties can be supported through the Noble Store (CCP takes a cut, hands money over to developer, win-win).

CCP is charging with 100% certainty $99 to people who currently are working for to make the game better in the hopes that these people might recoup that $99 plus whatever other expenses they might have.

Another basic rule of economics: People are loss averse--i.e. they don't like the "Great News" option above.